Nunavut gov't in conflict of interest over medevac contract, company alleges

Two affidavits filed in October allege the Government of Nunavut withheld information and appeared biased when it awarded a 2011 medevac contract for the Kitikmeot region.

Adlair Aviation is suing the Commissioner of Nunavut, the Government of Nunavut and Mark McCulloch, the territory's senior manager of procurement and logistics, for $31.5 million after the contract was awarded to Aqsaqniq Airways Ltd., a partner of Yellowknife-based Air Tindi.

The affidavits were in response to a motion for a summary judgment filed by the defendants, which would avoid the case going to a trial.

A sworn statement by Bruce Jonasson, an aviation consultant for Adlair Aviation, says it "appears likely" the contract was awarded to Aqsaqniq Airways in order to settle a lawsuit between another Air Tindi partner, Kivallingmiut Aviation, and the Government of Nunavut.

In that suit, Kivallingmiut Aviation Inc. and Medic North Nunavut sued the same parties named in Adlair's suit for more than $6 million in general and punitive damages after it was passed over for a medevac contract in the Kivalliq region.

An access to information disclosure to Adlair Aviation in June showed that four days after Aqsaqniq Airways was awarded the Kitikmeot contract in August 2012, a letter from a lawyer representing Kivallingmiut Aviation advised that the suit was being discontinued.

Adlair Aviation's lawyer, Ed Brogden, said it took a long time to get the documents from the territorial government and that they contain a number of emails and records that Adlair Aviation alleges it was told had disappeared or had never existed.

"It just blew us away," said Brogden.

"All of the things we'd gone through access to information for about 20 times, the privacy commissioner gone to court to get, there were investigations over, there were claims they didn't exist ... all of a sudden we have them."

Elaine Keenan Bengts, Nunavut's Information and Privacy Commissioner, wrote to Nunavut's acting manager of Access to Information and Protection of Privacy (ATIPP) requests, Mary Anne de Guzman, on Oct. 2.

"These allegations, if true, raise a number of serious concerns," she wrote.

"I would ask that you investigate these allegations and provide me with a detailed explanation as to why these records were not disclosed during the ATIPP process."

Brogden said one of the records disclosed to Adlair was a handwritten note on a purchasing worksheet that declared there was no conflict of interest for the team evaluating the request for proposals for the Kitikmeot medevac contract.

"They declared that they had no conflict of interest, even though the same people were being sued by the people they granted the contract to," Brogden said.

Evaluation members snubbed

The affidavits also allege two of the five evaluation committee members, Kim Dunlop and Clara Evalik, who were from the Kitikmeot region, were left out of the final decision to award the contract.

In one email exchange on Aug. 3, 2011 between Evalik and McCulloch, she questions a proposal about dedicating fewer than two medevac aircraft in Cambridge Bay.

"I stated in the beginning that I did not want to pursue evaluating proposals that could not provide two dedicated aircraft in Cambridge Bay," wrote Evalik.

McCulloch responds later in the afternoon, underlining his text: "Solicitor Client Privileged, Please do NOT send any further emails on this topic until we have had an opportunity to further consider options."

"It says that they knew they had a conflict," Brogden alleges. "It says that they knew they were in trouble, and they didn't want any record available to anyone."

Proposal vs. bid

The affidavits also argue the Government of Nunavut treated applications by Adlair Aviation and Aqsaqniq Airways differently. They suggest Aqsaqniq's submission was treated as a proposal allowing for follow-up questions over the proposed use of a Learjet 35A, whereas Adlair's was treated as a final bid, which omitted a Nunavummi Nangminiqaqtunik Ikajuuti (NNI) form allowing for bid adjustments.

The NNI policy is meant to ensure Inuit-owned firms, Nunavut-based businesses and local businesses are given preference when awarding government contracts. Aqsaqniq Airways is registered under the policy as a Nunavut-based business.

After the contract was awarded, Adlair appealed to the NNI Contracting Appeals Board. The appeal was dismissed and in December 2012, Adlair Aviation filed a lawsuit against the territory.

The case is waiting for a motion hearing to be scheduled before it continues in court.